Europe Helps Bioenergy Target Coal

In its commitment to a low carbon economy, the European Union (EU) set aggressive targets for reducing greenhouse gas (GHG) emissions, expanding renewable energy production, and reducing the over-all consumption of energy. Known as the 20-20-20 Targets, EU countries have agreed to achieve the following targets by 2020:

- At least 20% of EU gross final energy consumption to come from renewable energy sources;

- At least 10% of transport final energy consumption to come from renewable energy sources;

- A 20% reduction in primary energy use compared with projected levels, to be achieved by improvingenergy efficiency.

Of the strategies the EU employs to reach their targets, an emphasis on biomass indicates a commitment to a diverse primary energy portfolio. Like wind and solar, bioenergy has experienced considerable growth in Europe, particularly in the heat and power sectors. Coal remains an important fuel, but is also the largest contributor of GHG emissions in the EU behind petroleum. The North American pellet industry has an excellent opportunity for further growth in replacing a percentage of coal in cofire scenarios or entirely on its own as a fuel source. Understanding where coal is consumed in Europe will offer more opportunities in the economic development of bioenergy in the low carbon economy of the EU.

The consumption of coal among the largest consumers in the EU for 2011 is visualized in Graph 1. Germany, by far, consumes the greatest amount of coal among EU countries, five times more than the United Kingdom. Some of the disparity between Germany and the rest of the EU countries in annual coal consumption is that the German economy is considerably larger than other EU economies and therefore requires more energy to power it. To compare countries with variously sized economies on more equal terms, Graph 2 shows the coal intensity of the country’s energy system. Annual coal consumption is divided by total energy consumption, giving the prevalence of coal in that country’s energy system. In Graph 2, the disproportion between countries is less prominent when you correct for the size but the ranking within Graph 2 follows a similar trend to Graph 1 with Germany having the greatest intensity and Sweden having the lowest. Despite some variability among years, coal consumption has remained relatively steady across the sample of countries in the graph, even increasing last year.

Coal accounts for 26 % of Europe’s GHG emissions in 2010. Burning pellets from North America in existing coal facilities is a present and growing market. The stability of the 20-20-20 target policies is vital to the continued health of the North American pellet market.